Innovation at Work: Keeping the Best Talent with the Best Benefits
What your company can learn from some of the best
by Michelle Swanda, Principal Financial Group

The good news is that the economy appears to be rebounding. The bad news is that employees who've toughed out pay cuts and long hours may start seeking greener pastures en masse as the job market picks up. A recent Accenture survey reports that 38 percent of middle managers in the U.S. are currently looking for another job. Of those nearly two-thirds which is equal to 64 percent plan to intensify their search when the job market strengthens. Companies which treat employees well now will have a better chance of keeping them when jobs become plentiful again and, therefore, avoiding the high cost of turnover.

One group of small businesses-recently recognized nationally for excellence in employee benefits have found that ensuring employees' financial futures by providing a solid package of employee benefits is a significant factor in attracting and keeping top talent. The Principal 10 Best Companies for Employee Financial Security have designed creative and innovative benefits programs that have allowed them to maintain their commitment to employees, despite the rising costs of benefits. The result: the winning companies boast an average voluntary turnover rate of four percent, which is less than one-half of the nationwide average of nearly nine percent.

The Principal 10 Best Companies share their tactics in a new, free booklet entitled, Innovation at Work, A Guide to Best Practices in Employee Benefits. Here are a few highlights:

Healthcare Benefits

• Offer more than one plan so employees have a choice between a low-cost option and a higher-cost plan with richer benefits.
• Consider offering a consumer-driven healthcare plan as one of the options.
• Create a culture in which employees understand and expect that the medical benefit plan will be reviewed and changed annually due to the dynamic nature of the healthcare market.

Retirement Benefits

• Consolidate different types of retirement plans with one provider (and on a single administrative platform) to save time and money.
• On an annual basis, show employees who do not contribute up to the maximum company 401(k) match exactly how much money they miss out on.
• To increase employee deferrals into a 401(k) plan, require a minimum contribution level before offering the employee match. For example, provide a 100% match on employee deferrals of 4% to 8% of pay.

Employee Education and Communication

• Distribute a total compensation statement annually to each employee. This summary shows each employee's annual compensation, as well as the cost to the company of each benefit that the employee receives.
• Use benefits-savvy employees to help educate other employees on benefits.
• Create a benefits committee - made up of employees - to gain input and recommendations on benefits.

You can access the full best practices guide at www.principal.com/10best. The Principal 10 Best Companies were selected by a blue ribbon panel of judges, renowned for their expertise in employee benefits, including Dallas Salisbury, president and CEO of the Employee Benefits Research Institute and David Wray, president of the Profit Sharing Council of America.

Michelle Swanda
Corporate Marketing Manager
Principal Financial Group

back to NAWBO-OC website